Caterpillar to Start Packaging Diesel Engines in Brazil

Offshore drilling increases demand for locally sourced gen sets, electric propulsion systems

Add Brazil to the list of overseas markets where Caterpillar Inc. is investing in new operations. Local reports indicate that the construction and mining equipment manufacturer has a $200-million expansion program underway for its Caterpillar Brasil subsidiary, which produces 40 different machine models, including hydraulic excavators, compactors, wheel loaders, motor graders, backhoe loaders and track-type tractors. It produces generator sets in the 32- to 750-kVA range, special tools, and accessories for its equipment.

Significant oil and natural gas discoveries off the coast of Brazil have increased activity in the country’s energy sector, and spurred demand in marine and petroleum markets.

Caterpillar’s latest Brazilian expansion will be a new operation to package generator sets and diesel electric propulsion systems for marine and petroleum customers there. Starting in 3Q 2011, 3500C series engines will be packaged at an expanded operation in Piracicaba, near Sao Paulo. The 3500C series is commonly used in tug and salvage, cargo, and offshore applications.

"The strategic decision to expand product offerings packaged in Brazil is based on Caterpillar's global corporate strategy, which forecasts continued positive growth in Brazil," stated Caterpillar vice president Richard Case. "Across the company, we consistently strive to win with customers and make it easy for them to do business with us. Increasing our presence in Brazil will enable us to achieve both goals."

The generator sets and diesel electric propulsion systems will include a significant volume of products produced locally, and Caterpillar said the expansion will help it to serve customers in the growing marine and petroleum offshore markets better.

"The need for reliable offshore power for marine and petroleum applications is expected to increase as Brazil's petroleum reserves are developed and expanded. We have been pleased with the success of the 3500 diesel electric propulsion and marine auxiliary power generation in the Brazilian offshore market, and we will continue to develop high-speed and medium-speed offerings for our offshore customers," according to Case.

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